DC Circuit Strikes Part of EPA Recycling Rule

WASHINGTON (CN) – A divided D.C. Circuit rejected challenges Friday to a 2015 rule governing the recycling and collection of solid hazardous waste, restoring a prior rule that gives businesses more discretion to decide who will cart off and recycle their waste.

The majority on the three-judge panel upheld most the Environmental Protection Agency’s 2015 final rule on the definition of solid waste, but agreed with the American Petroleum Institute and others that argued portions of the rule were regulatory overreach.

The ruled laid out requirements for when certain hazardous materials are disposed of, and expanded the EPA’s regulatory authority in some instances.

Both the Sierra Club and the American Petroleum Institute challenged the EPA’s disposal rules but for different reasons.

The Sierra Club argued the waste rules didn’t do enough to safeguard the environment and API dubbed them as arbitrary and capricious.

Under the Resource Conservation and Recovery Act, the EPA manages all solid and hazardous waste falling under the definition of “garbage, refuse, sludge … and other discarded material.”

In 2008, the EPA finalized a rule deregulating hazardous materials generated in the industrial process but excluded garbage, refuse and sludge from the “solid waste” definitions save for two exemptions. Those exemptions asked if the waste was controlled by the entity that generated it and asked whether or not was the waste “transfer-based?”

In other words, did the group who created the waste, also send it to a previously audited off-site recycler or reclaimer?

“Under the transfer-based exclusion, a generator could send materials to any reclaimer it chose, provided that after making a reasonable investigation, it affirmatively answered five questions about the reclaimer,” the ruling explained.

Those questions asked if waste generators had a legitimate recycling process in effect; if they had notified regulators of their own operations and financial stability; if they remained free of any recent enforcement action; if they acquired the adequate skill and equipment to recycle products and finally, if the entity would be able to adequately dispose of residual waste generated during recycling.

By setting up generator and transfer exemptions, the EPA argued, “legitimacy factors” were created and distinguished “true recycling” from “sham recycling.”

To test that legitimacy, the EPA also demanded that waste-creators meet four additional factors. First does the hazardous secondary material provide a useful contribution to the recycling process? Second, does the recycling process produce a valuable product? Third, do those controlling the waste manage it as a valuable commodity and fourth, is product of the recycling process comparable to a legitimate reusable product?

API specifically challenged the validity of the third factor, demanding that companies in charge of waste treat the byproduct as a “valuable commodity.”

“Where there is an analogous raw material, the firm can meet this standard by handling the secondary material “in an equally protective manner,” the ruling stated, “If there is no raw analogue for comparison, EPA requires that the secondary material be “contained.”

Contained, according to the EPA meant waste is held in a unit that’s appropriately labeled or that a log is put in place identifying any secondary hazardous materials which may be present.

The Sierra Club argued that since the EPA’s waste disposal regulations are sometimes very costly, there lies an incentive for some entities to claim they are recycling when, in fact, they are just directly disposing of waste.

U.S. Circuit Judges Brett Kavanaugh and Stephen Williams decided to uphold the EPA’s rule only partially.

They agreed that waste creators must treat hazardous materials as valuable and find the most effective ways to dispose of them but the judges did not agree that the EPA can determine whether or not the recycling of those materials are comparable to a “legitimate product.”

U.S. Circuit Judge David Tatel filed a dissenting opinion.

“In the end, the fundamental problem with the court’s conclusion — that the Administrator needs more proof that offsite recycling is unsafe before requiring a variance — is that the court decides for itself a policy question Congress left to the Administrator. The [Resource Conservation and Recovery Act,] envisions a careful balance of authority between EPA and this court. Today the court upsets that balance,” Tatel said.